The Impact of Total Quality Management on the Profitability of a Manufacturing Company

Introduction

Given the idea that there is a great competition and value on the quality of production, every manufacturing company seeks for the continuous ways in improving the quality of their product. Because of the pressures coming from the customers, certain suggestions are formulated, adopted, implemented, changed, innovated, and once again introduced.

Background to the Study and Statement of the Problem

The concept of the total quality management is more focus on how to get the procedure done with efficiency and quality performance while meeting the demands of the clients. The teams’ approach on the idea of TQM added the competitiveness in the industry. As the main topic of the paper, what is the impact of the TQM on manufacturing company’s profitability?

Purpose of the Study

The purpose of the study is to create a call for the manufacturing industry in continuing their development and focus in giving the consumers’ their quality product. Keeping the products in the level of quality is the greatest advantage a business can have.

Significance of the Study

The study itself is looking forward to contribute in the fostering growth of TQM approach in the face of the manufacturing industry. In addition, the study serves as the tool for relaying the information on to the impact of the TQM in the manufacturing industry.

Objective of the Study

The main objective of the study is to determine the impact of the TQM, concepts and principles within a manufacturing business. Through that the train of ideas will be highlighted such as the importance of TQM in various type of industry.

Research Questions

The study has certain questions and will be the engine of the entire study to demonstrate the right answers about the TQM on the manufacturing industry.

1. What is the main idea that involved in the implementation of TQM?

2. What is the common nature of work inside a manufacturing business with the idea of TQM?

3. What are the benefits that the TQM can deliver?

Scope/Delimitation

The scope of the study is under the concept and nature of manufacturing business. Manufacturing includes the production of the products in which in the physical form. The rendering or providing of services is the limitation of the study.

Literature Review

The TQM scope the idea of quality control practices. The control maybe in terms of the commitment of the management, focus on the customers, relationship on the suppliers, benchmarking ideas, training, control on the resources, zero-defects, process improvement, and quality measurements (Agus, Ahmad, and Muhammad, 2009). It is natural in the manufacturing’s nature of work is deploying the resources. Many of the practices which they also considered as the strategies are the just-in-time (JIT) systems, total quality control (TQC), technologies, capacity utilization, and the developmental activities (Maiga and Agrawal, 2003). Many of the successful business considered the QTQM as the organizational technology that allowed them to increase the level of productivity. In other areas, the TQM can help the manufacturing businesses push the combination of cost cutting while improving the productivity that leads to the profitability of the entire manufacturing business (Subedi and Maheshwari, 2007).

Research Methodology

The applied method of the study is through the utilization of questionnaires among the companies that deployed the process of TQM in their business settings. The population of the participants is based on the number of employees involved in the production process. The questionnaires included the essential questions that specify the techniques applied by the workforce in order to attain the productivity and for the management to realize the profitability. Through the focus of the management in the quality and cost the productivity of the business can be attained. Higher quality of production reduces the defects, scrap and re-works or repairs. With the TQM businesses can manage the cost and expenses. In fact, the companies that produce the high quality of products can charge higher prices can earn higher profit margins.

Conclusion

Companies should not ceases to produce the quality kind of products, besides, its all worth it because with the TQM there is a significant high control that makes the company save some investment and gain profits. Meeting the demands of the customer is the very basic idea in creating business and through that, companies can have the competitive advantage in the market. This idea pushes the business to place additional effort in integrating the different techniques that can promote the efficiency of the TQM.

References

Agus, A., Ahmad, M., & Muhammad, J., 2009. An Empirical Investigation on the Impact of Quality Management on Productivity and Profitability: Associations and Mediating Effect. Contemporary Management Research, Vol. 5, No. 1. [Online] Available at: http://www.cmr-journal.org/article/view/1177/2646. [Accessed 05 Feb 2010].

Maiga, A., & Agrawal, S., 2003. Impact of the Extent of Management Initiatives on Manufacturing Plant Profitability, An Exploratory Investigation. JAMAR, Vol. 1, No. 2. [Online] Available at: http://www.cmawebline.org/publication/jamar-v1-2-maiga.pdf. [Accessed 05 Feb 2010].

Subedi, D., & Maheshwari, S., 2007. Impact of Total Quality Management (TQM) on Profitability and Efficiency of Baldridge Award Winners. Delhi Business Review X, Vol. 8, No. 1. [Online] Available at: http://www.delhibusinessreview.com/v8n1/5.pdf. [Accessed 05 Feb 2010].